Just a few hours ahead of WWDC 2018, Ming-Chi Kuo has shared his latest investors note for his new firm TF International Securities. In the note, he says that Apple will follow a more aggressive pricing strategy for its 2018 iPhone lineup which will comprise of three phones.
The company will be adopting a more aggressive price policy this year due to concern over “the negative impact of a higher price in a mature smartphone market on selling momentum.” Other factors for the lower prices of the 2018 iPhone lineup include improved yield of key TrueDepth camera components, a reduction in component cost, and the company’s approach to increasing Face ID users as it would benefit its ecosystem.
Thanks to the aggressive pricing, Kuo now believes the iPhone X Plus with a 6.5-inch OLED display be priced around $900-$1000, with the smaller 5.8-inch 2018 iPhone X seeing its price drop to $800-900. As for the 6.1-inch LCD iPhone, it would be priced around $600-$700. Essentially, this means Apple will be reducing the prices of its 2018 iPhone lineup by $100.
We forecast that Apple will adopt a more aggressive price policy for the following reasons: (1) concern over the negative impact of a higher price in a mature smartphone market on selling momentum, (2) improved cost structure, which is mainly attributed to assembly yield improvements of end product & 3D sensing and cost reduction of components, and (3) increasing users of Face ID benefiting the promotion of the Apple service and ecosystem.
The analyst also believes that Apple will be announcing all three new iPhones at its event in September thereby debunking rumors of the 6.1-inch LCD iPhone seeing a possibly delayed launch in November. The combined launch of all three iPhones at once means Apple will see a noticeable increase in its shipments starting from the end of Q3 2018. Kuo expects the momentum for 2018 iPhones to continue until Q2 2019.[Via MacRumors]